Governor Dayton Announces $100 Million in New Funding for Small Businesses
October 26, 2011
Small Business/Banking Partnership Expansion Seizes on Momentum of Governor’s Jobs Summit
ST. PAUL — Building on the momentum from Tuesday’s statewide jobs summit, Governor Mark Dayton announced today that he will take immediate action to provide Minnesota job creators with access to funding by doubling the state’s investment in small businesses through a Small Business/Banking Partnership.
“This funding doubles Minnesota’s investment in our small businesses. These funds will help break down one of the largest barriers to job growth in our state. After spending the past nine months talking to Minnesotans about how we get our state working again, entrepreneurs need to know that we are going to work aggressively to give them the tools they need to create jobs. Today, I am taking action to spur investment in the small businesses that fuel Minnesota’s economy,” Governor Dayton said.
The Minnesota Small Business/Banking Partnership will be established by doubling in size a current program to make funds available to qualifying Minnesota banks for direct lending to job creators. Administered through the Minnesota State Board of Investment, approximately $100 million to $200 million will be deposited in Minnesota’s community banks for lending to their customers – principally small businesses throughout the state.
To qualify for the program, banks must have a rating of at least “satisfactory” from the Minnesota Department of Commerce and must be well capitalized. Deposits will be fully insured by the Federal Deposit Insurance Corporation (FDIC). The expansion of the Small Business/Banking Partnership will provide financial institutions throughout Minnesota with up to $200 million to lend to small businesses, helping to grow revenues, add jobs, and increase Minnesota’s tax base.
The partnership comes at the recommendation of the Governor’s Small Business Capital Access Task Force. The task force was established to address the concerns raised repeatedly by small businesses — that investment capital and credit are more difficult to obtain and their unavailability is a significant constraint to business expansion and job growth.
To address these issues, the task force was charged with making practical, prudent recommendations to the Governor to improve the flow of investment capital and credit to small businesses and to recommend other financial strategies for facilitating job retention in Minnesota.